The U.S. House of Representatives voted last week 248 to 179 to change the definition of a full time employee included in the Affordable Care Act (Obamacare) back to a 40-hour work week. This was a key vote for ABA.

Beginning in 2015, PPACA requires businesses with 100 or more full-time equivalent (FTE) employees to offer affordable health insurance to full-time employees or pay significant penalties. Businesses with 50 or more FTEs must offer affordable health insurance to full-time employees and their dependents or pay penalties beginning in 2016. PPACA defines full-time employee as an employee who averages 30-hours of service per week, or 130-hours of service per month.

Despite the one year delay of the employer mandate requirement and more recent transition relief for midsize businesses, employers must begin closely tracking employee hours and making these complicated administrative calculations this year, as business size calculations are based on an employer’s workforce during the preceding calendar year. Without H.R. 2575, employers will see increased administrative expenses and disruption of their traditional business schedule. Employees will see reduced hours and take home pay.